This is something I have been wondering about for a while. Is there a good way to transition from a payed app to a free app without hurting your old users? For example you may have an app that cost 0.99 and later want to make it free with just some ads. But of course you don't want to display them for the people who already bought the app before. Is it possible to detect if someone have bought the game before? It should be I would think? :S

The other option is to do a "GAME TITLE FREE" version but it would be much simpler and better to just have the old game become free instead?

Meh, I'd do a paid version with an update that adds more, and a free version with the previous abilities or accessories. Just sounds better and better treats your paid users.

The other option is to do a "GAME TITLE FREE" version but it would be much simpler and better to just have the old game become free instead?

A lot of devs do that. 2 different versions.

Sadly, it takes away from your traffic. But on the one hand, it gives you a funnel of free users to potential buy the paid version. The difference is removing ads.

Moving this to Business.

It is possible to check old receipts for when the purchase was made, and enable functionality if the user previously payed for it before it "went free".

We do it for one of our games.

Unfortunatly I don't know exactly how, and the guy who did left for the day, I might be able to ask him tomorrow.

It is possible to check old receipts for when the purchase was made, and enable functionality if the user previously payed for it before it "went free".

We do it for one of our games.

Unfortunatly I don't know exactly how, and the guy who did left for the day, I might be able to ask him tomorrow.

This might help: http://stackoverflow.com/questions/3735635/convert-existing-ios-paid-app-to-freemium-model-with-in-app-purchase. Although it looks like appStoreReceiptURL is only available for iOS7 and above. You might need to resort to save game versions or other imperfect approaches on older SDKs.

would be much simpler and better to just have the old game become free instead?

Depends on how you implemented your system already.

While some games do split out free and paid versions, that isn't what I normally see.

The iOS ecosystem has Apple-provided 'receipts' that you can download for your app.

The example from Apple's developer library is straightforward:

NSURL *receiptURL = [[NSBundle mainBundle] appStoreReceiptURL];
NSData *receiptData = [NSData dataWithContentsOfURL:receiptURL];
BOOL rocketCarEnabled = [self receipt:receiptData includesProductID:@"com.example.rocketCar"];

New customers who don't have the matching receipt flags get the free version, those with the flags get the benefits.

Do you have a user data base ?

If so, add a column with a default - all existing entries are denoted as "old".

Let the change take effect, than change the default of the column to "new" .

Whenever some one logs into your application, add a check for if they are "new" or "old" .

The multiple apps route is most common although personally I think it's messy especially when the free version lets you pay in-app to turn it into the paid version.

Having your app able to check if the user has paid and use that to control ads would be neater if it's easy to do... what @Shippou says basically. Then you can still add a "pay to remove ads" in-app purchase for anyone who wants it.